Lockdown takes a toll on independent contractors

Independent contractors have been hard hit by the impact of COVID-19 but there is hope

Afew months ago, news of the coronavirus (COVID-19) pandemic remained a far-fetched reality for most South Africans. It was business as usual for workers and businesses across most sectors.

This was to change dramatically, however.

Global infection and death rates spiraled and it became evident that South Africa faced a similar fate. Measures to contain the spread of the virus brought with them adjustments to social interaction and movement and created a heightened awareness of personal hygiene.

Workplaces, as a microcosm of the larger society, reflected the impact the looming crisis would have on the country. Businesses sought various means to protect their personnel, customers and suppliers, while facing the reality that this would have financial implications and affect their bottom line.

Up to that point, businesses were still trading as normal, probably with some random and slight changes, but with no variation in terms of workers' earning potential.This was in line with Section 22 of the Constitution, which states that,“every citizen has the right to

choose their trade, occupation or profession freely.The practice of a trade, occupation or profession may be regulated by law”.

Then COVID-19 hit South Africa's shores. National reported cases and deaths due to it prompted government to take stringent measures to control its spread.

On 23 March 2020, President Cyril Ramaphosa announced that,“the National Coronavirus Command Council has decided to enforce a nationwide lockdown for 21 days, with effect from midnight on Thursday, 26 March 2020”.

The tone of the President's message was that this was a well thought out and necessary measure to save lives in the face of the ravaging virus. He acknowledged the impact the lockdown would have on people's livelihoods, on the life of our society and on our economy. He also encouraged participation of all citizens, including corporates, to save people's lives, jobs, businesses, property and the economy.

Earning potential interrupted

As the lockdown kicked in, businesses ceased to trade as normal and some people's earning potential was interrupted. Paradoxically, the lockdown elaborated the socio-economic differences and the associated workplace dynamics.The reality hit various businesses, households and individuals differently. While some faced uncertainty brought about by COVID-19 and the lockdown with absolutely no fear of any additional financial burden, others were not so fortunate.

The various multi-departmental interventions announced by President Ramaphosa, as government's response to the economic consequences of the coronavirus on citizens, remained a beacon of hope for those adversely affected.

Despite the measures in place, uncertainty seemed to prevail amongst some categories of citizens, including vulnerable employees and independent contractors.

Vulnerable employees are employees in non-standard forms of employment who, in comparison with employees employed on a permanent basis or for an indefinite period, enjoy few or no benefits.

Granted, the 2014 Labour Relations Act amendments regulate non-standard employment. However, there are still pockets of employees with little protection. This includes precarious workers who, for various reasons, do not benefit from the Unemployment Insurance Fund (UIF). For example, those not employed formally, casual workers, workers whose employers do not make contributions to the UIF, workers who themselves do not make UIF contributions and even foreign workers without the necessary work permits.

According to UIF Communications and Marketing Director Makhosonke Buthelezi,“the law states that any worker who works for 24 hours per month or more must be registered and contribute to the UIF”.Therefore, only qualifying employees are eligible to claim from the UIF for loss of income during the lockdown period.

Help for distressed businesses

In these circumstances, it can only be hoped that employers will not opt for actions that will have adverse effects on workers but will instead explore other government measures in place to help businesses in distress.

For example, they may apply to the Commission for Conciliation, Mediation and Arbitration for relief through the Temporary Relief Scheme in the event that, due to the coronavirus pandemic, the business faces business closure or retrenchments.

Measures in place to assist vulnerable citizens with, for example, food packages, may also provide temporary relief under such adverse circumstances.

General uncertainty in terms of

the impact of COVID-19 has not been unwarranted, especially because it comes in the midst of a reported global financial crisis. Oxfam is also projecting that half a billion people could be pushed into poverty by the coronavirus.

There has also been uncertainty in terms of what the nationwide lockdown means for independent contractors. Some independent contractors faced the abrupt cancellation of their projects and services already booked. Granted, COVID-19 is no-one's fault.Therefore, no one could be blamed in this regard, as people's safety had to be placed first.

Independent contractors are 'own account workers' operating in both the private and public sector, across various fields, for example, professional services, legal, IT, human resources and arts and crafts. Ordinarily, they take on the 'self-employed status' by choice.

In some fields, proactive measures have been taken to honour commitments for contracted independent contractors and freelancers during the lockdown period. For example, as published in various media, actors and independent contractors can claim for cancelled work from the Department of Arts and Culture.

For some independent contractors, however, there has been no broad clarity on measures in place to assist with the economic consequences of the pandemic.

Provisions for independent contractors

Department of Trade and Industry spokesperson Sidwell Medupe clarified that the provision for independent contractors falls under the scope of the Department of Small Business Development (DSBD).

Asked about government interventions in place for independent contractors, DSBD Media Liaison Officer Priscilla Monama indicated that the department is developing measures to support the informal sector. She says a detailed plan will be announced once finalised.

On the issue of some independent contractors not being registered as companies/businesses, Monama clarified that while the aim is to provide support, it is important to be able to track and trace support measures, as well as provide broader linkage with other government entities.

“For this reason, the informal sector is also required to register on our SMME SA database and undergo the necessary verification, so as to measure the level of support required,” says

Monama.

On 9 April 2020, President Ramaphosa announced that the National Coronavirus Command Council had extended the lockdown by another two weeks. This meant, overall, 35 days of no work for some people.

The President once again reiterated the government's comprehensive economic response package, with assistance from other stakeholders, to assist various sectors, businesses, workers and vulnerable citizens affected by the lockdown. He indicated that this would be executed in phases, based on assessed needs, with immediate needs being prioritised.

Overall, it appears that there is hope for precarious workers and independent contractors. As they say, the taste of the pudding is in the eating. In the next few months, the systems set in place by government will be tested. It can be anticipated that the systems may be inundated with applications, due to the magnitude of the crisis.Therefore, it goes without saying that patience and cooperation may be required from all stakeholders.